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Glossary

A

Annualised return

This indicator is a geometric average annual return over a given period. It provides the investor with a calculation of the annual return net of taxes and commissions.

Asset allocation

Selection of assets for investment, to achieve the best portfolio mix in line with the previously established risk/return profile

Asset Management

Professional services and activities aimed at maximising the value and return of the fund’s real estate assets, by identifying measures enabling strategic asset management.

Auditing Company

A company that performs checks on the fund’s books to make sure that there are no irregularities. Following the analysis, the company issues a certification report (usually attached to the half-yearly report and financial statements).

Average daily trading value

The value in euro of a traded real estate fund, defined as the product of the number of traded units and their official market price.

B

Benchmark

Reference parameters – such as category or market indices – showing the trend of the fund investment markets. Benchmarks are explicitly defined in fund-related documents by the asset management company according to management goals and the expected risk/return profile

Borsa Italia S.p.A.

Company responsible for the organisation and management of the Italian Stock Exchange and the Telematic Funds Market. Market on which closed-end real estate funds are traded.

C

Call of commitments

The time when, once the placement is concluded, the SGR collects unit subscription fees from investors. As far as contribution funds are concerned, the call of commitments coincides with the date of asset contribution.

Capital gains

Realised gains from the sale of an asset at a higher price than the acquisition price posted on the financial statements. Capital gains can also derive from the evaluation carried out by independent experts based on market value, and not from the actual sale of an asset.

Capital Loss

Capital loss deriving (in the case of real estate funds) from the purchase and sale of real estate assets and equal to the negative difference between the property’s sales price and purchase price, net of any matured interests or expenses.

Charges

The charges that the fund, the investor or the SGR are subject to, as set out in the management regulations of the various real estate funds.

Collective asset management

A service regulated by the Legislative Decree 58/98 and consisting of a) the promotion, establishment and organisation of mutual investment funds and the management of relationships with investors; b) the management of own or third-party OICRs (Italian Collective Investment Undertakings), by carrying out investments in financial instruments, credits or other movable or real estate assets.

Collocamento

Il procedimento di emissione del fondo immobiliare sul mercato (nel caso di offerta al pubblico indistinto) o comunque (nel caso di collocamento privato) nei confronti degli investitori. L'esercizio professionale di questo servizio è riservato esclusivamente agli intermediari previsti dal Testo Unico D. Lgs. 24.02.98, n. 58 (cd. Testo Unico della Finanza). Il collocamento viene affidato, in genere, ad un intermediario finanziario, che provvede all'operazione di sottoscrizione dei titoli da parte del pubblico degli investitori.

CONSOB

Acronym indicating the Italian Securities and Exchange Commission, established in June 1974. This commission is made up of a President and four members (experts in the financial market) who are appointed by the Italian Council of Ministers and remain in office for 5 years. The Commission has the power to: regulate Stock Exchange contracts, set minimum amounts to be traded on the Stock Exchange, define the prerequisites for admission to the Stock Exchange, identify price fixing methods, approve prospectuses for the admission of new companies to the Stock Exchange or for the placement of new mutual investment fund units or SICAVs (Open-Ended Investment Companies). In order to ensure a regular market trend, the Commission may also impose sanctions on those who do not act correctly and expel financial advisers, suspend the activities of SIMs (stockbrocking companies), etc.

Contribution

The contribution of assets to the fund.

Corporate governance

Insieme delle regole alla base della gestione dell'impresa, che stabiliscono gli organi dell'azienda e le loro relazioni, ad esempio, sulla ripartizione dei compiti, l'assunzione delle responsabilità e i poteri decisionali.

D

Dealing Code

Code defining how operations carried out by persons who – by virtue of their function – have access to confidential information and involving closed-end real estate (and security) fund units traded on regulated markets, are notified to the market.

Dematerialisation

Starting from 1 January 1999, listed securities have ceased to exist in paper format. Thanks to the Monte Titoli centralised system, rights are guaranteed by the book-keeping entries kept by the financial intermediary (SIM, Bank) where investor’s securities are deposited.

Depository Bank

A bank carrying out checks on fund management and acting as a custodian for fund securities and cash. It also checks compliance of fund operations with existing laws and fund regulations

Destination of use

The function (residential, offices, production activities, etc.) that a certain property is destined to be used for, confirmed by town planning documents related to the property.

Dividend Yield

Indice che permette di misurare la redditività del provento distribuito, rapportandolo con il costo dell'investimento iniziale sostenuto (dividendo/valore emissione quota).

Due diligence

Investigation aimed at evaluating a property from a technical/construction, town-planning, environmental, administrative, market and financial point of view, normally carried out before an investment is made. This process is mainly based on a comparison between the property’s actual state and the relevant documents.

E

Exit Commission

The commission retained by the SGR upon redemption of fund units (rarely applied in case of real estate funds).

F

Facility Management

The integral management of real estate assets, necessary for the correct running of the buildings. It is mainly based on the planning of maintenance and requalification activities and on the management of relationships with suppliers

Fondo immobiliare ad apporto

Fondo costituito tramite il conferimento di beni immobili, diritti reali immobiliari o partecipazioni in società immobiliari da parte di un soggetto (l'apportante). Il fondo ad apporto prevede la possibilità di sottoscrizione delle quote mediante conferimento di beni. A seconda della natura del conferente il fondo sarà pubblico o privato.
Le quote del fondo immobiliare che vengono attribuite all'apportante in cambio del conferimento effettuato sono poi ricollocate sul mercato dalla SGR. Per il potenziale investitore tale tipologia di fondo offre il vantaggio di conoscere, prima della sottoscrizione, l'elenco degli immobili costituenti il fondo, essendo così in grado di esprimere una propria valutazione del patrimonio, delle conseguenti potenzialità di reddito, di sviluppo o di rivalutazione, e di decidere di conseguenza.

Fondo immobiliare chiuso

Fondo il cui patrimonio, e quindi il numero delle quote, è fissato al momento della sua promozione. In tale tipologia di fondo il diritto al rimborso delle quote viene riconosciuto ai partecipanti solo a scadenze predeterminate, in quanto la sua durata è predefinita. Le quote del fondo possono essere acquistate solo in Borsa successivamente alla quotazione.

Fund Charges

Management regulations envisage the following types of charges (please refer to the prospectus, listing information and Management Report for official data): · SGR annual management commission, equal to a percentage of the fund’s total asset value or net assets, as defined in the management report, net of unrealised capital gains on real estate assets and on shareholdings against their purchase value · annual commission paid to the Depository Bank for controlling the SGR in relation to any harm suffered by individual investors and due to the SGR’s non-compliance with its obligations. · commission paid to independent experts for their evaluation of property assets · charges deriving from the purchase and divestiture of the Fund's assets (real estate brokerage commissions and taxes, legal and notary fees, etc.) · administration, maintenance and renovation costs relating to fund properties · other charges (insurance premiums, publication costs, audit fees, financial expenses for fund loans, legal fees, taxes, supervision fees) · overperformance commission (carried interest), commission due to the SGR based on the performance achieved at the expiration of the fund.

Fund Manager

The Fund Manager is appointed by the SGR to identify strategies aimed at maximising fund returns while minimising risks.

Fund value

The fund value is given by all fund assets net of liabilities. It is calculated by the Board of Directors within 60 days of the end of the financial year and within 30 days of the publication of the half-yearly report. The evaluation of individual fund components is based upon the criteria established by the Supervisory Authorities in compliance with Legislative Decree no. 58 of 24.02.98 (Italian Consolidated Law on Finance). The unit value is published twice a year in the newspapers as specified in the Prospectus and Fund Regulations.

G

Global coordinator

Bank or SIM (Stockbroking company) that coordinates the placement and oversees the offer process of a company’s financial instruments.

H

Half-yearly report and financial statements

Official documents and certificates providing savers and investors with an overview of the fund investment and assets composition. These are deposited and put up at the registered office and at the central office of Borsa Italiana (if the fund is listed) within a day of approval and – within 30 days – at the depository bank, as well as in the relevant sections of the fund's website (for retail funds).

I

Indipendent Experts

Persons or companies (meeting the necessary legal requirements) whose task is to carry out regular technical investigations, estimates and evaluations on a fund's real estate portfolio, with a view to assessing the value of a property.

Internal Rate of Return

A measure of return on an investment that takes into account the invested capital as well as the size and timing of cash flows. Technically it is the discount rate whereby the actual value of expected net cash flows is equal to the value of generated assets.

IPO

Initial Public Offering, i.e. the first offering of shares to the public by a privately-owned company. The Italian acronym is OPV.

ISIN Code

Alphanumeric code assigned to a financial instrument by the Ufficio Italiano Cambi (the Italian Exchange Office). Each instrument has its own ISIN code, which is unique and identifies the securities

L

Leasing

A contract between two parties (a lessor and a lessee), giving the latter the use of an asset – purchased or built (upon the lessee’s choice and indication) by the lessor – for a set period of time. At the end leasing period, the lessee may choose to purchase the asset based on the conditions defined in the relevant contract.

Leverage

Management of all the necessary activities for the planning, performance and monitoring of maintenance interventions on the properties.

M

Maintenance

Management of all the necessary activities for the planning, performance and monitoring of maintenance interventions on the properties.

Management Commission

Commission applied as remuneration for the management of the fund’s assets. It corresponds to the percentage of the fund’s total assets that is kept by the management company. The management commission is not a manifest cost, as the fund’s returns – calculated according to the unit trend – already include the management commission

Management policy

The real estate investment strategy adopted by the SGR to achieve and exceed minimum return targets

Market discount

The difference – due to small traded volumes – between the unit market price (depending on supply and demand), and its net asset value (NAV), as defined in the fund half-yearly report and financial statements. Consequently, any investor wanting to pull out before the fund’s expiration date may do so at the current market price

Market Quanity

The total number of units exchanged daily on the markets regulated by Borsa Italiana S.p.A.

Monte Titoli S.p.A.

Monte Titoli S.p.A. a joint stock company and the Italian central securities depository (shares and bonds). The company was established in 1978 on the initiative of the Bank of Italy, of a group of banks and professional associations belonging to the CIPA (Interbanks Convention for Automation–Related Problems) and of stockbrokers. Law no. 289 of 19.06.1986 transformed Monte Titoli from a trust company into a service company, with a view to rationalising the deposit and management of securities.

N

NAV

The net asset value of a real estate fund, defined in the half-yearly reports and financial statements and equal to the difference between the real estate fund's assets and liabilities, taking into account technical investigations carried out by independent experts. This is also the reference data that is used for redemption upon unit liquidation.

NAV Discount

The value expressing the variance between the net book value of a fund unit – as defined in the half-yearly report and financial statements – and the unit price as traded on the stock market. This discount depends largely on the limited amount of liquidity on the stock market.

Notes to the accounts

The document in which company directors, in drawing up the Financial Statements, provide all the clarifications for a better understanding of the Balance Sheet and the Profit and Loss Account. The Notes to the Accounts must specify the evaluation criteria used, provide a detailed analysis of the main items and present the most significant management data

O

Offerta Pubblica di Vendita

Si definisce OPV come ogni offerta, invito ad offrire o messaggio promozionale, in qualsiasi forma rivolti al pubblico, finalizzati alla vendita di prodotti finanziari.

OICR

Undertaking for Collective Investment in Assets. The Italian Consolidated Law on Finance introduced the acronym OICR, which replaced the OICVM (undertaking for collective investment in transferable securities).

Ordinary Real Estate Fund

A Fund established through the subscription of units by savers. Financial resources collected from the public are then used by the SGR to purchase real estate assets, real estate rights or shareholdings in real estate companies.

Overperformance Commission

Commission retained by the asset management company based exclusively on the results achieved by the fund. The percentage is usually commensurate with the increase in unit value against the increase of a reference parameter referred to as “return target”. The return target is the result above which an overperformance commission may be acknowledged to the SGR. In other words, the “minimum” result is the reference point for the calculation of the above-mentioned commission, and not a realistic return parameter investors can expect upon the expiration of the fund.

P

Patrimonio netto

È l'insieme delle attività che fanno capo a un fondo di investimento immobiliare, al netto delle eventuali passività. In sostanza, si tratta dell'insieme dei capitali che il gestore di un fondo amministra per conto dei sottoscrittori.

Performance

The result achieved by the fund management. The performance of closed-end real estate funds is calculated with the Internal Rate of Return method, that takes into account any paid-out returns.

Prezzo ufficiale di Borsa

È il prezzo ufficiale giornaliero di una quota di un fondo immobiliare negoziato sul segmento MTF di Borsa Italia, che riflette la domanda e l'offerta presenti sul mercato. E' la media ponderata di tutti i prezzi relativi alle contrattazioni avvenute durante la seduta borsistica.

Property Management

Si tratta delle attività di gestione dell’amministrazione immobiliare in tutti i suoi aspetti: gestione dei contratti di locazione e di manutenzione, promozione di strategie per la valorizzazione degli immobili.

Property Valuation

The process used to determine the increase/decrease in property value over time. In a real estate fund, this value is calculated on the basis of assessments carried out on a six-monthly basis by independent experts.

Prospectus

Document approved by the Italian Stock Exchange and by Consob, whereby the SGR gives the investor all the necessary information on the product's characteristics and which the sale of mutual fund units depends upon. The prospectus must be provided to the client before the latter purchases fund units. It must contain all the necessary information for the investor/saver to get a clear view of the investment being proposed.

Q

Qualified/institutional investors

Organisations that periodically have at their disposal large sums to invest. “Qualified Investors” – as defined by art. 1, par. 1/h of Ministerial Decree 228/99 – are:

· Investment companies, banks, stockbrokers, asset management companies (SGR), open-ended investment companies (SICAV), pension funds, insurance companies, parent holding companies of bank groups and persons listed in articles 106, 107 and 113 of the Italian Consolidated Law on Banking;

· foreign persons authorised to perform the above-mentioned activities, in compliance with relevant national laws;

· banking foundations;

· natural and legal persons and other bodies with specific competence and experience in operations with financial instruments, as explicitly stated in writing by the natural person or by the legal representative of the legal person or body

R

Raccolta

La raccolta è costituita dall'ammontare dei versamenti effettuati dai sottoscrittori delle quote del fondo.

Rating

The credit standing assessment, performed by a private specialist agency, of a company that places its financial products on the international markets. The rating provides traders with consistent information on the issuers' risk rate and proves extremely useful for investors who cannot conduct independent credit risk analyses. It other words, the rating is an essential and efficient information tool to provide the market with an accurate assessment carried out by a skillful team of independent and qualified economic, financial and management experts.

Real Estate

Asset class including investments in property or in companies and investment instruments that conduct real estate transactions or invest in real estate.

Real estate distribuiting funds

Funds in which capital gains (deriving from the sale of properties or from fund profits) are – entirely or partially – regularly distributed to investors.

Real Estate Funds

A financial instrument whereby real estate assets are managed directly or indirectly – through shareholdings in real estate companies. For the fund to belong to this category, at least two thirds of its total value must be invested in real estate. Italian real estate funds are generally closed-end. In other words, units are only redeemed at set intervals, given the limited amount of liquidity characterising this type of investment. Legislative Decree no. 351 of 2001 and Ministerial Decree no. 47 of 2003 introduced the possibility of successive issue of units and early redemption, with a view to increasing fund liquidity. These funds may be classified according to the category of potential subscribers (retail or qualified investors), the property acquisition method (contribution or non-contribution) and dividend payout policy (distributing or non-distributing fund).

Real estate non distributing funds

Funds in which capital gains (deriving from the sale of properties or from fund profits) are not distributed to investors, but increase the fund overall value. Investors receive money only when the units are sold or the fund liquidated.

Reference market price

Average price of the last 10% of trading during the day session. It is calculated in the closing period (between 17.30 and 17.50) and creates the basis for the calculation of percentage variations, etc. It normally differs from the official price.

Reference time scale

The investment in real estate funds, by its very nature, has a mid to long-term time scale of about 10-15 years. In any case, the lifetime of a real estate fund cannot exceed 30 years.

Regulations

Document that completes the information contained in a fund Prospectus. A fund’s Regulations must be approved by the Bank of Italy and contain all the rules defining how the fund works and what the roles of the parties involved are, and governing the relationships with fund investors.

Reits

I Reits (Real Estate Investment Trust) sono i fondi immobiliari Usa più comunemente trattati. Tra questi esistono tre grandi categorie: equity fund (gestiscono immobili acquistati o costruiti); mortgage fund (rilevano e gestiscono crediti ipotecari); hybrid fund (sommano le caratteristiche del primo e secondo tipo).

Return of a real estate funds

The return of a real estate fund is made up of the profits deriving from financial and property investments and from their professional management. The two factors give the following results: the capital gain and the return from rental contracts

Return target

The return target is the result above which an overperformance commission may be acknowledged to the SGR. In other words, the “minimum” result is the reference point for the calculation of the above-mentioned commission, and not a realistic return parameter investors can expect upon the expiration of the fund. Performance evaluations of real estate funds must take into account the fact that return targets derive from economic estimates and offer no guarantee of future profits. Furthermore, units may only be redeemed upon expiration of the fund and upon the conditions set out in the fund management regulations

Returns

Returns are profits generated by the fund – excluding unrealised capital gains – indicated in the fund half-yearly report and financial statements. They can be distributed periodically to unit holders (as provided for by the SGR’s Board of Directors based on fund management regulations) or accrued and paid out upon liquidation of the fund.

Risparmio Gestito

Termine che indica l'investimento effettuato indirettamente, tramite istituzioni finanziarie (banche, SIM, fondi comuni, compagnie di assicurazione) autorizzate dalla legge.
Il risparmio gestito può assumere diverse forme, quali:

la gestione individuale, effettuata da banche o SIM. La gestione può essere obbligazionaria, azionaria, bilanciata, e può essere orientata solo su titoli italiani o solo su internazionali. Si tratta, in pratica, di un prodotto molto specifico che un risparmiatore si sceglie, affidando a professionisti esperti il suo capitale e lasciando loro la più ampia libertà di scelta nell'ambito dell'indirizzo indicato.
la gestione collettiva o "in monte", effettuata da una compagnia di assicurazione o da un fondo comune d'investimento. Le compagnie di assicurazione usano lo strumento delle polizze "a capitale differito" che consentono di incassare, dopo un certo numero di anni, una certa cifra in funzione dei rendimenti conseguiti (con un minimo garantito); i fondi comuni non garantiscono nulla, ma la loro gestione (fortemente dinamica) offre in genere soddisfacenti risultati nel medio - lungo periodo.

S

Securitisation

Financial operation involving the sale of properties or other assets to a third company that undertakes to manage or to convert the assets into bonds.

SGR

Italian acronym standing for Società di Gestione del Risparmio (Asset Management Companies): i.e. companies that are authorised to carry out collective management of financial products (mutual funds) in conformity with the Italian Consolidated Law on Finance. Company assets are separated from fund assets. Authorised SGRs in Italy are entered on a specific register held by the Bank of Italy.

Spin-off

Method used by a company to split its operations and assets by creating a new company. It proportionately distributes shares in the new company to its own shareholders.

Sponsor

An intermediary that cooperates with the issuer for the listing approval of financial instruments and undertakes to guarantee the quality information provided by the issuer.

Subscription Commission

The commission paid by fund participants at the time of the first subscription and (where applicable), when subscriptions are reopened. No subscription or entry commissions apply for funds managed by Fimit SGR.

Supervisory Authorities

The Regulatory and Supervisory Authorities for the Italian real estate markets, namely the Italian Ministry of Economy and Finance, the CONSOB (Italian Securities and Exchange Commission), the Bank of Italy, the ISVAP (Insurance Supervisory Authority), the COVIP (Pension Funds Supervisory Commission) and the Italian Stock Exchange.

T

Telematic Funds Market

A segment of the Telematic Stock Market on the Italian Stock Exchange (operative from 1 July 2002) dedicated to the listing and trading of closed-end mutual investment funds, indexed open-end mutual investment funds and ETFs (Exchange Traded Funds). On this segment, real estate fund units are traded exactly like shares:
The trading timetable is as follows:

· 08.00 - 10.50 opening auction, pre-trading period;

· 10.51 -10.55 opening auction, validation period;

· 10.55 -11.00 opening auction, opening period;

· 11.00 -16.35 closing auction, pre-trading period;

· 16.36 -16.40 closing auction, validation and closing periods

U

Unit

Unit of measurement of an investment fund, i.e. the units into which fund assets are divided. When subscribing to a fund, a certain number of units are purchased (all with the same unit value) at a set price. Usually, units are grouped in a multiple certificate and the SGR is not aware of their individual registration

Unit value

V

Vacancy rate

Percentuale di spazi (immobili) "vacanti" (cioè non occupati/locati) offerti in vendita/locazione.

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